Nigerian banks are still maintaining elevated lending rates, despite the Central Bank of Nigeria's (CBN) recent cut of the Monetary Policy Rate (MPR) from 26.5% to 23%. This significant reduction, announced on September 22, 2026, marks the largest cut in nearly two decades but has not yet translated into lower borrowing costs for consumers.
The CBN clarified that the MPR adjustment is not a typical easing measure but an operational recalibration aimed at aligning the benchmark with actual market conditions. Currently, lending rates across banks range from 20% to 46%, depending on various factors including customer risk profiles.
Many banks are still assessing the implications of the CBN's decision. Sources within several institutions indicate that while deposit rates may decrease, there are no immediate plans to adjust lending rates. The Asset-Liability Committee (ALCO) will play a crucial role in determining any future changes.
Experts are urging banks to reflect the CBN's policy changes in their lending practices to foster economic growth. Without a meaningful reduction in borrowing costs, the anticipated benefits of the MPR cut could be limited, potentially hindering investment and economic progress.
Overall, while the CBN's MPR cut is a step towards easing financial conditions, the response from banks remains cautious, leaving borrowers in a state of uncertainty regarding future lending rates.